With the Justice Department already investigating possible monopolistic practices by Comcast (NASDAQ: CMCSA) in the $5 billion spot advertising market, the MSO's top rival in that sector, Viamedia, has filed an anti-trust suit against it.
Viamedia is seeking $225 million in damages in a suit filed Monday in the Northern District of Illinois federal court. The company is accusing Comcast Spotlight, the division that controls Comcast spot ad sales, of shutting out rivals from interconnects it controls.
As an example, the company claims Comcast excluded Viamedia clients WideOpenWest and RCN from interconnects in Chicago and Detroit. In order to obtain access to these interconnects, these MSOs had to agree to let Comcast Spotlight broker their spot ad sales.
Last November, the DOJ launched an investigation against Comcast, looking at very much the same allegations. The DOJ hasn't revealed where that investigation stands.
"The American advertising market is robustly competitive, and advertisers have never had more choices to reach consumers," Comcast said in response. "Local cable advertising competes with local broadcast TV, radio, newspapers, outdoor display, and the rapidly growing digital marketplace. All multichannel-video providers — or MVPDs — account for only about 7 percent of local advertising sales."
"In the top 50 DMAs, nearly half of the interconnects, including those in the country's two largest markets, New York and Los Angeles, for local cable advertising are not run by Comcast," the Comcast statement added.
For its part, Viamedia has been an aggressive lobbyist in regard to Comcast, spending $650,000 just to try to stop the MSO's takeover of Time Warner Cable (NYSE: TWC) last year, according to government filings.
- read this Wall Street Journal story
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